Rihanna Sues Former Accountants

Pop star accuses them of losing tens of millions of dollars

July 5, 2012 5:50 PM ET
Neil Lupin/Redferns via Getty Images

Rihanna has sued two former accountants and the New York-based Berdon LLP, accusing them of bad bookkeeping, a failure to recommend she cut expenses during a 2009 tour that was losing money, tens of millions of dollars in losses and an ongoing audit by the Internal Revenue Service, the Associated Press reports.

Rihanna filed the suit in a Manhattan federal court under her real name, Robyn Fenty. Through her attorneys, she alleged that the defendants took millions from revenues from four national and international tours over five years.

According to the lawsuit, by Rihanna's 2009 "Last Girl on Earth" tour, she discovered that her tour had managed "significant net losses," despite the fact that revenue was up. The suit goes on to claim that the defendants took 22 percent of said revenue while paying Rihanna just 6 percent.

The suit alleges that these accounting practices where Berdon paid itself a percentage of gross tour income as commission was not standard in the accounting and business management industry, and it left no incentive to "counsel" Rihanna when it came to cutting costs or controlling her finances.

As proof of Berdon's poor bookkeeping, the suit points to the massive success of Rihanna's 2011 "Loud" tour, which produced a net profit equal to more than 40 percent of total tour revenues.

Rihanna reportedly hired the accountants back in 2005, when the Barbados-born singer was 16 and starting her career; she fired them in September 2010. In the suit, she accuses them of being responsible for an ongoing IRS audit of her tax returns, which forced her to pay to correct the errors caused by Berdon's negligence.

The pop star's attorneys also blamed the firm for encouraging Rihanna to purchase a new home in 2009 while her tour was losing money, something a competent business manager would not have done. Last year, Rihanna sued a real estate company over that home, claiming its serious structural defects made it uninhabitable.

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